The construction of thousands of affordable homes in Dublin may be under threat following a Government threat to withhold millions in funding for their construction.

Earlier this year, over €15 million in funding was allocated to Dun Laoghaire-Rathdown County Council for the development of 8,000 new homes in Cherrywood, a suburb close to Shankill.

The funding was allocated as part of the Local Infrastructure Housing Activation Fund (LIHAF) to provide infrastructure to the area, which would assist in the development of the new houses.

Under the terms of the LIHAF, housing developers who benefit from the new infrastructure are required to commit to build houses quickly and at affordable prices.

But according to The Irish Times, Dun Laoghaire-Rathdown County Council has not met the July deadline to submit details of any deal it struck with developers to construct the housing.

A spokeswoman for Dún Laoghaire-Rathdown County Council told the same source that negotiations between the council and developers were ongoing, and that any agreement would be submitted when the discussions are completed.

The Department of Housing also told The Irish Times that funding had been approved “in principle” but that the Minister would "not sign grant agreements with local authorities for funding of the LIHAF infrastructure unless he is satisfied that an appropriate agreement has been reached between the local authority and any relevant developers reflecting the contribution of LIHAF on a given site”.